Jerome Powell is the God of Hellfire and he brought us …. FIRE! By rapildy raising The Fed’s target rate rapidly. And then sending mixed signals as inflation begins heating up … again.
WTI crude just hit $90. Rising oil prices may be one of the reasons.
It wasn’t!
Producer Prices rose 0.7% MoM in August (up from +0.3% in July and hotter than the +0.4% exp). That is the hottest PPI since June 2022, and pushed YoY prices up 1.6%…
Source: Bloomberg
Goods prices are reaccelerating fast, now back into inflation YoY (as Services cost growth slowed only modestly)…
Source: Bloomberg
As a reminder, much of last month’s PPI rise was driven by a big jump in portfolio management costs – as stocks soared. August saw a further rise in those costs…
Source: Bloomberg
More problematically, the pipeline for PPI appears to have inflected as intermediate demand is re-accelerating…
Source: Bloomberg
This is not what The Fed wanted to hear.
